The following amounts appear on the trial balance of Valentine Variety Store, Inc. as of December 31, 20x2, the end of its fiscal year

Dr. Cr.

Cash $4,000

Merchandise inventory 15,000

Other assets 8,000

Liabilities $4,000

Common stock 5,000

Retained earnings 7,300

Sales 80,000

Sales return and allowances 600

Cost of goods sold 47,700

General and administrative expenses 8,000

Selling expenses 13,000

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Totals $96,300 $96,300

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On December 31, 20x1, the companys merchandise inventory amounted to $13,000. Supplementary records of merchandise activities during the 20x2 year disclosed the following:

Invoice cost of merchandise purchases $48,500

Purchase discount received 900

Purchase returns and allowances received 400

Cost of transportation -in 2,500

Required:

Using the data above, complete the income statement for valentine Variety Store Inc. for December 31, 20x2 using the multiple-step method